Anxiety escalates as Thai baht hits 5-year record high

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BANGKOK, March 20 – Thailand’s baht currency surged to a record high in five years today, compelling the jittery finance minister to discuss a possible intervention by the central bank.

The Thai baht appreciated in contrast to other regional currencies this morning at Bt29.13/15 against the US dollar.

One financial analyst said there was ‘unreasonable’ profit-taking and the massive sale of US dollars in the domestic market.

Deputy Prime Minister/Finance Minister Kittiratt Na-Ranong admitted continued deep concern with the baht’s appreciation since it departed the level of Bt31 against the US dollar.

He said he will discuss with the central bank chief in today’s economic ministers meeting on measures to stabilise the Thai currency.

Mr Kittiratt insisted that he has never asked the Bank of Thailand to reduce the policy interest rate below the “natural” level but “Thailand’s current policy interest rate is unnatural.”

“It should be adjusted appropriately. The central bank should not misinterpret the government’s proposal as a political interference,” Mr Kittiratt said.

Meanwhile, Thai stocks nosedived for the second consecutive day when the market opened this morning.

The benchmark SET index plunged sharply more than 30 points (2 per cent) with heavy profit taking for the second consecutive day as investors fear possible measures to stem the unit’s rapid appreciation.

Mr Kittiratt said the stock market’s negative movement was unrelated to the government’s approval of a bill on Bt2 trillion loan for the country’s infrastructure investment on Tuesday.

“An external factor might be involved in the falling stocks but there is nothing to worry about,” he said.